Part 4 — Directors and Officers of Cooperatives Division 1 Number, Qualifications and Functions of Directors
79 Directors' liability for wages
liable to employees of the cooperative for all debts not exceeding 6
months' wages payable to each employee for services performed
for the cooperative while they are directors.
(2) Subsection (1) does not render a director liable for debts for
wages
(a) if the director believes on reasonable grounds that the
cooperative can pay the debts as they become due, or
(b) if the debts are payable to employees for services performed
while the property of the cooperative is under the control of
a receiver, receiver-manager, trustee in bankruptcy or
liquidator.
(3) A director is not liable under subsection (1) unless
(a) the cooperative has been sued for the debt within 6 months
after it has become due and writ proceedings have been
returned unsatisfied in whole or in part,
(b) the cooperative has commenced liquidation and dissolution
proceedings or has been dissolved and a claim for the debt
has been proved within 6 months after the earlier of the date
of commencement of the liquidation and dissolution
proceedings and the date of dissolution, or
(c) the cooperative has made an assignment or a receiving order
has been made against it under the Bankruptcy and
Insolvency Act (Canada) and a claim for the debt has been
proved within 6 months after the date of the assignment or
receiving order.
(4) No action may be brought against a director under this section
more than 2 years after the date that person ceased to be a director.
(5) If writ proceedings referred to in subsection (3)(a) have issued,
the amount recoverable from a director is the amount remaining
unsatisfied.
(6) If a director pays a debt referred to in subsection (1) that is
proved in liquidation and dissolution or bankruptcy proceedings,
the director is entitled to any preference that the employee would
have been entitled to, and if a judgment has been obtained, the
director is entitled to an assignment of the judgment.
(7) A director who has satisfied a claim under this section is
entitled to contribution from the other directors who were liable for
the claim.